Nissan Motor India will be introducing a car smaller than its existing compact car, the Micra. The new car will wear the Datsun nameplate when it gets launched in 2014. A statement to this effect is expected to be made by Kiminobu Tokuyama, managing director, Nissan Motor India tomorrow.

This announcement follows the one made by Nissan Motor Company CEO Carlos Ghosn today in Indonesia. On his visit to the country, Ghosn had said of the Datsun that, “It’s a green car, affordable car, small displacement, high local content. It's going to be a generous car." The entry-level model will be introduced in the Indian, Indonesian and Russian markets in 2014.

In an interview with Business Standard in August 2011, Tokuyama had said, “We are studying our opportunity for the launch of a small car under the Micra, which is where there is a segment between Rs 2 and 4 lakh. We have seen a great potential for growth in that segment.”

The Datsun model could be dimensionally close to the Maruti Suzuki A-star. The A-star is also sold as the Nissan Pixo in various markets around the world and it is manufactured by Maruti Suzuki in India. The contract between Nissan and Suzuki for the manufacture of the Pixo ends in 2013 and it is expected that the Datsun will replace the badge-engineered Suzuki in the Nissan portfolio.

Introduced in Japan in 1931, the Datsun brand established a strong foothold for the Japanese carmaker in the all-important US market beginning in the 1960s. But the nameplate was completely discontinued by 1986 globally in favour of the Nissan brand. Now, the brand is making a comeback in the three emerging markets initially in the form of a low-cost, affordable hatchback.

By branding this car as a Datsun, the Japanese carmaker can be aggressive with its pricing, without affecting the premium image of the Nissan nameplate. By calling it a Datsun, it allows the carmaker the flexibility to strip the entry-level hatchback of features that would otherwise have to be present in a car wearing the Nissan tag.

The Datsun brand adorned not just value-for-money cars but iconic sports cars as well. It also pioneered a new category of compact pick-up trucks during its successful stint in the US market. The brand had an aggressive presence in motorsport too.

Nissan has a plant in Oragadam near Chennai which churns out Renaults as well. The Micra is badged and sold as the Renault Pulse in the country. Renault is also said to be looking at entering the entry-level segment and the Datsun being badged and sold as a Renault cannot be ruled out.